Forget Biggie — the real soundtrack of Brooklyn is the din of construction, reverberating up and down Flatbush Avenue as luxury condo after luxury condo springs from the ground like brushed steel weeds. But developers are starting to realize that they may have overshot their mark.
The Times reports that the incredible boom in new apartments has finally saturated the market, forcing landlords to offer rent breaks and deals as a means of luring potential tenants.
In the 10-block stretch between the Barclays Center and Myrtle Avenue alone, 19 new residential buildings are either in the process of rising or have already been built. Those, combined with four more buildings on Myrtle Avenue, amount to 6,500 apartments.
So what sort of breaks are we talking here? Over at 7 DeKalb, for example, the landlord is offering two months free on a 14-month lease, meaning a one bedroom unit can be had at the bargain basement price of just…$3,428 per month. Pocket change! I could find that in the filter of my diamond-encrusted Roomba. (Kidding, of course, I would never handle a Roomba — I have all my carpets burned immediately after use.)
But surely a softening of prices on the high end must eventually benefit the lower end, right?
Not really, says Jonathan Miller, the president and chief executive of real estate consulting firm Miller Samuel. “The hope is that you will see more modest prices as a result,” Miller tells the Voice. “I don’t see this happening in a meaningful way for several years.”
Miller says the issue isn’t too many units generally, but too many that cater to the market’s upper end, above $3,500 per month. That skew toward luxury has been so pronounced that any drop off in development now will only soften its razor edge, without having any direct impact on the cost of more affordable housing. The benefit, Miller said, is that market trends will henceforth be more sustainable, putting a badly needed cap on development that for a minute there looked like it might not cease until every mom-and-pop bagelry had been subsumed by glass lobbies. “It stops the upward trajectory,” he said.
Around the city, median rents have increased 12 percent over the past eight years, while income has increased by just two percent. Indeed, employment numbers are at a record high, though half of the city’s 90,000 private sector jobs are low-wage. Compounding the issue is that Brooklyn’s population growth is five years ahead of trend, while changes in rent control laws have cost the city 250,000 affordable apartments over the past few decades.
“The problem is that there’s a mismatch between what we’re building and the jobs we’re creating,” Miller said.
If there is a leveling effect on the horizon, it may be due to another reason entirely: The L train, which is scheduled to stop running into Manhattan for around 18 months, beginning in 2019. The neighborhood’s moneyed residents may move to less transit-stagnant territories — say, Downtown Brooklyn? The glut of stupid glass apartments would get filled, maybe even easing Williamsburg’s stratospheric rents in the process. Our parents can’t not afford to buy us our own places there!
So remind me, then, who exactly this is bad for?
"feared" by whom?? this is great news for renters. (via NYT) pic.twitter.com/jbSNyIeNLP
— Eric Boehlert (@EricBoehlert) August 30, 2016